Natural justice in tax assessments requires prior notice and hearing before turnover enhancement is finalised.

An assessment enhancement made without prior notice to the assessee and without a personal hearing is treated as contrary to natural justice, particularly where the revised turnover is increased on the basis of an enforcement report. In tax assessments carrying civil consequences, fair procedure requires that the dealer be given an effective opportunity to contest any adverse upward revision before finalisation. The note states that such an order is unsustainable, is set aside for breach of natural justice, and the matter is remitted to the assessing authority for fresh consideration on merits after granting a personal hearing.

---

---

Issues: Whether the assessment orders were liable to be set aside for violation of natural justice in enhancing the turnover without notice and without granting an opportunity of personal hearing.

Analysis: The assessment was revised upward on the basis of the enforcement report and subsequent proceedings. The record showed that the turnover was enhanced from the originally proposed figure without notice to the assessee before the final enhancement, and the assessee was not given a personal hearing on that aspect. In a tax assessment, where civil consequences follow, observance of fair procedure requires that the affected dealer be heard before an adverse enhancement is made.

Conclusion: The impugned orders were unsustainable for breach of natural justice and were set aside.

Final Conclusion: The matter was remitted to the assessing authority for fresh consideration on merits after giving the assessee an opportunity of personal hearing.

Ratio Decidendi: An assessment order enhancing tax liability without prior notice and an effective opportunity of hearing is vitiated for breach of natural justice and must be set aside for reconsideration.

---